Unemployment Trust Fund in Okla. at Highest Level Since 1997

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A strong economy has boosted Oklahoma’s unemployment insurance trust fund to its highest level since 1997.

The fund, which is used to pay unemployment benefits to workers who lose their jobs, had $705 million by June 30, according to the Oklahoma Employment Security Commission.

Employers pay into the trust fund based on a ratio set by the Legislature. Fewer unemployment claims generally mean lower unemployment insurance tax rates for employers the next year. It also means there’s more money available for unemployment benefit checks.

“It’s designed to be counter-cyclical,” said Lynn Gray, the commission’s chief economist. “The trust fund builds up when the economy is going well so we can pay out benefits when we do have an increase in claims.”

Mike Seney, senior vice president of operations with The State Chamber, said unemployment tax rates are a significant business expense.

“We watch that thing like a hawk,” Seney said. “It’s not as large a budget item for employers as something like workers comp, but it definitely affects the bottom line.”

During the 2004 recession, businesses were paying up to $1,270 in unemployment insurance taxes annually for each employee. For 2007, maximum unemployment taxes for companies are capped at $765 per employee.

Unemployed Oklahomans claiming jobless benefits also could see a slight increase in benefit payments in 2007. With the new rates, weekly unemployment benefit checks will range from $16 to $342, the commission said. In 2006, the maximum benefit was $317 a week.

David Blatt, policy director with the Community Action Project in Tulsa, said it will also be easier for some low-wage workers to qualify for unemployment benefits under the rate changes for 2007.

Information from: The Oklahoman, www.newsok.com.